“We would never have done it without >>venture>>”

Three former >>venture>> winners are now competition sponsors and sit on the Advisory Board. How did they become successful entrepreneurs? What do they think about the current generation of startups? How did the IPO or sale of their companies change their lives? 

Julian Bertschinger (Covagen/Johnson & Johnson), Patrick Amstutz (MolecularPartners), , and Felix Mayer (Sensirion) tell their stories (pictured below).

Mr. Bertschinger, Mr. Amstutz, , Mr. Mayer, you have founded successful businesses, created many jobs, and actively support the Swiss economy. What role did >>venture>> play for Molecular Partners, Covagen, and Sensirion?

Julian Bertschinger (JB), Covagen (acquired by Johnson & Johnson in 2014) A very important one. When we took part, we weren’t sure about whether we should really start a business. We would never have done it without >>venture>>. Aside from that, through the competition we got in contact with the Novartis Venture Fund, which gave us our first seed money.

Patrick Amstutz (PA), Molecular Partners All of the members of the founding team were scientists. We would always find a reason to carry out yet another experiment before founding the company. >>venture>> forced us to write a business plan.

Felix Mayer (FM), Sensirion The competition was a point of crystallization for us too. We wanted to take part in 1998, but my co­founder and I were working on our dissertations at the time. We knew we would have to wait two years before the competition took place again [before 2015 >>venture>> was held biennially, ed.], so we forced ourselves to write a business plan. Then, on the same day that I presented my dissertation, we also presented our company to the >>venture>> advisory board and won first prize. That’s when we knew we had to start the business.

What did you learn at >>venture>>?

JB The role models were very important. For us, that was your company, Patrick, more than anything else. You proved, two years before us, that it’s possible to found a biotech company in our specific sector. That gave us the confidence and the motivation we needed.

PA We scientists always believe the world is entirely data driven. At >>venture>>, though, you can only win if you convince the jury with your presentation. That made us realize the importance of networking.

FM If you don’t get in contact with the customers, you can’t sell them the product. At >>venture>> we learned for the first time how to promote ourselves.

Today there are startup competitions with prizes of a million dollars. At >>venture>> the winning team receives 150,000 Swiss francs. Does the prize money need topping up?

JB In our industry, biotech, one million wouldn’t make that much of a difference.

If a company wants to finance itself through prize money it would need twenty or thirty million. That’s unrealistic, and it’s not the job of a startup competition.

FM I think there are too many places where startups can get 100,000 Swiss francs more or less “for nothing” these days. There are lots of entrepreneurs chasing these pots of money, but it makes them less successful in the medium term because they’re tailoring their startups to the funding opportunities instead of to their customers.

All three of you are involved in >>venture>> today. Your companies are sponsors, and you sit on the advisory board and work as jurors and coaches. Why?

PA Entrepreneurship is a virtue that we want to support. And we want to give something back after all the incredible support we’ve received along the way.

JB If our engagement helps only one person on the entrepreneurial path, then we’ll have fulfilled our mission. But it’s also very inspiring to see the young teams: they are highly motivated and extremely creative.

How do today’s participants differ from your generation?

JB They are much better at communication and pitching than we were. I’m almost embarrassed when I think back to how we presented ourselves back in the day. In the pitch we focused way too much on technical aspects instead of strategy.

FM This makes things much harder for the jury, though. You first have to crack open the marketing shell to find out what’s really inside. All of the projects look the same today, right down to the identical J­curve of their financial figures. I prefer things less ironed out—the way they were before. It was authentic.

PA I like presentations that are not all rosy but point to the obstacles. It makes them credible.

JB I have to disagree: communication is extremely important. Of course, a good pitch contains a section about risks. But when you look at how companies in the US are given vast sums of capital on the basis of very little scientific data, you can either find it ridiculous or you just can watch what these companies achieve. It’s not uncommon for the hype to become a self-fulfilling prophecy. But if you insist on staying small, never accepting financing tranches larger than two million Swiss francs, you can miss out. Looking back, we should have marketed ourselves better. We missed out on a number of opportunities.

PA I only partly agree with that. There are companies with over a billion in venture capital, which have yet to prove that their idea works. They tie up investment money that really good projects could use.

JB Well, the Americans are quick enough to throw in the towel if something’s not working. It’s a key part of the maxim “Go big or go home.”

PA That’s true. We are currently pretty active in the US, and we’re having to learn to pitch differently. No one listens to us if we don’t “go big.”

Have you noticed differences in mentality in everyday working life as well?

FM American customers are often amazed when we actually deliver the goods we had promised—they’re not used to that. That’s why in Asia they have less trust in American companies than they do with us Swiss.

JB When it comes to reliability, the Swiss are more like the Japanese than the Americans.

How did you actually start your business?

FM My co­founder and I started looking for an idea for a business in our second year at university. At one point, we registered a patent for film projections in train tunnels, but nothing came of it. Eventually, we realized that there was a lot of potential in my dissertation, so we decided to pursue that.

PA In the world of research, the saying goes that you will find funding if you want to do something good. But there’s no way of knowing if this is really the case, because so few ideas are actually put into practice. That’s what I wanted to change. With our first CEO, who has since passed away, I started actively looking around the university for a research group that was working on a good idea. That’s how we got to know the technology and other co­founders.

JB Even as a student my real interest was in applied research. We had lectures with Dario Neri, a professor who had founded companies based on his research. That was my moment of revelation. I saw that it really is possible and that I can be part of it. My co­founder and I both did our PhDs with Neri, and we decided to found a startup. We each brought an idea to the table. We quickly abandoned mine though (everyone laughs).

How did the people around you react when you decided to go the way of the entrepreneur?

JB My father was a professor all his life and my mother is also very academically minded, so they both found it very exciting. But my mother had a hard time understanding that someone would actually give starting capital to us greenhorns. For a long time, she thought it was some sort of sponsoring.

FM Our family were small business owners: my father ran a painting company that he inherited from his father. At the end of the month, the employees came to our house to collect their wages in envelopes. I liked this world. I wanted to start my own business as far back as I can remember.

I did an apprenticeship at Siemens and quickly realized that a big company wasn’t my thing. I was horrified by the inefficiency.

Today, with 750 employees, I’m suddenly on the other side, and I can see how hard it is to be big and efficient.

Mr. Amstutz, you were the first in your family to do a PhD. Were your parents disappointed that you “only” wanted to start your own business?

PA My father is a job counselor and works a lot with young people who are struggling in school. During my studies, he often told me how privileged I was, but when I created our company and the first jobs, I rose dramatically in his esteem.

Since founding your companies, have you ever come across an idea that would have been better to pursue?

(silence)

JB Well of course there are times when you’re listening to a talk at a conference and you think, wow, that sounds promising.

But to do it would mean leaving your own firm. We have all said yes to an idea.

You can’t and don’t want to just suddenly do something completely different.

PA Our company is based on a technology platform. You can use our molecules to treat different diseases, and that means that every new active substance is a bit like a new company. But we get evaluated according to the individual products rather than the platform. That bothered me at first because the technology is the most innovative part.

Is entrepreneurship the top discipline of the business world?

FM It might not be the top discipline, but starting a business certainly creates jobs and involves the employees in making things happen.

PA You see it in how much people talk about executive wages, whereas someone who starts their own business doesn’t have to attempt to justify themselves in public if they earn a lot of money. They took the risk: they pay the wages of lots of people.

Everyone understands that they deserve to earn the benefits if it pays off. Huge executive wages, on the other hand, are more difficult to justify. Why should someone earn so much money if they haven’t had to take a risk?

You began your careers by founding your own startups, and now you are running companies with hundreds of employees. What are you better at?

FM I’ve done a lot of different things at our company: I ran development for a while, before taking over operations, I was joint CEO, today I am joint president of the board. Anything’s possible, but I like to be a free agent, so I prefer it if the highly structured tasks are taken care of by other people.

PA In the old days, we had the myth of the all-­knowing CEO. Luckily, we don’t have to pretend that this is the case anymore.

Neither Julian nor I came up with the idea that led to the startup—so what?

Mr. Amstutz, Mr. Mayer, your companies have both taken the leap to be listed on the stock market. How have your lives changed since?

FM Amazingly little. I have not sold a single share, nor am I planning to do so. Everything in the company stayed as it was, just like we promised the team it would.

PA Ok, but something changed for your CFO (everyone laughs).

Share prices aren’t keeping you awake at night?

FM I have to say I’m shocked at how little market value seems to be linked with our performance. I knew this was the case, but I didn’t know the extent of it. Market value can increase up to 50 percent and then fall again without us communicating a thing.

That’s why I believe my responsibility is to the company, not the share price.

PA I can only confirm that. Our market value—and this is something I have to remind our employees of sometimes— reflects an external evaluation as well as market conditions, not the actual value of the company. It’s important that a drop in value does not overly impact morale. A side effect of the IPO is that now you come with a price tag attached and you are a firm someone can buy. We have just completed a deal with an American company which is almost as large as our market capitalization—we needed to explain why they can’t just buy us out.

Do you check your stock price every day?

FM Not every day, but certainly every now and then. I don’t want to embarrass myself if someone were to ask about it.

Mr. Bertschinger, you and your co-founder chose a different path. You sold Covagen for a rumored 200 million Swiss Francs to Johnson & Johnson. Does this feel very different from going public?

JB Absolutely. Before that, there would be five of us discussing strategy and then we’d take it to the advisory board. Now we’re part of an 80­billion­dollar company with 140 executives on the R&D team alone.

It also shapes how I go about things. There are incredible resources available to us for developing new technologies and drugs. Amongst other things, I still run the former Covagen team in Schlieren, and I’m responsible for all our active substances there.

According to legend, the Facebook executives who became billionaires when the company went public returned to work the next day as if nothing had happened. How were things at your company after your IPO/trade sale?

JB Exactly the same. There was so much to do after the sale. It was an exciting time. PA The IPO brought a bit more capital into the company, which is why we did it. That opened new and exciting possibilities. We just kept working as we always had.

FM Same here.

What do you still hope to achieve in your career?

JB I’m looking for intellectual challenges, and I want to do something that has an impact—in whatever field that may be.

PA We want to bring our own products onto the market. Now, after fifteen years, we have created approximately half the value ­added chain. I’m currently trying to work out how we can keep our innovative energy high and not fall back on a defensive position as we grow.

FM Sensirion is my baby and I will stick with it. Just because it’s doing well now doesn’t mean that will be the case tomorrow or the day after. Apart from that, I’m on various governing boards and I coach startups.

Would you want your children to found their own companies too?

FM My father had to take over the painting company from his father, and I’m very glad he didn’t impose that on me. He told me I could do whatever I wanted. I would like to pass that on.

PA There are certain values such as business ethics that I would like to pass on to my daughter: she should have an honest approach to whatever she’s doing, be prepared to shoulder responsibility, and be true to herself. But the rest is up to her.

INTERVIEW by Simon Brunner

Julian Bertschinger

holds a PhD in biochemistry (ETH) and is global head of external strategy for Janssen R&D in the areas of discovery research and product development. He co- founded Covagen, a clinical stage company that develops bispecific FynomAbs by fusing its human Fynomer binding proteins to anti- bodies, resulting in therapeutics with novel modes of action and enhanced efficacy. The current pipeline is focused on the treatment of inflammatory diseases and cancer. Janssen (Johnson & Johnson) acquired Covagen in 2014.

Patrick Amstutz

holds a PhD in molecular biology (University of Zurich) and is the co-founder, CEO, and a member of the board of directors of Molecular Partners, a listed biotech firm advancing a growing pipeline of DARPin therapies for the treatment of severe or life-threatening diseases with an initial focus on ophthalmology and oncology. Besides focusing on its own products, Molecular Partners is also collaborating with leading pharmaceutical companies like Allergan and Amgen to discover and develop DARPin therapies. The company was listed on the Swiss Stock Exchange in 2014.

Felix Mayer

holds a PhD in physics (ETH) and is co-founder and co-chairman of the board at Sensirion AG, one of the leading sensor companies for flow and environmental sensor solutions (volatile organic compounds, carbon dioxide, and particulate matter).

The highly sophisticated sensors are used in areas such as air conditioning, medical technology, solar panel production, and the automotive industry. Founded in 1998, the company has its headquarters in Stäfa (ZH) and employs 750 people in six countries. In 2018, Sensirion was listed on the Swiss Stock Exchange.